An opportunity for Bangladesh

February 1, 2017

Economists and garment exporters see the abandonment of 12-nation mega trade deal Trans-Pacific Partnership (TPP) as an immense opportunity for Bangladesh.

With the scrapping of the deal, they believe, there would be no future uneven trade preferences against Bangladesh in the US market.

Vietnam, a signatory of the TPP, is a major competitor of Bangladesh when it comes to exporting garments to the US market. As per the TPP, Vietnam was supposed to enjoy zero-duty benefits. But now, things might be quite different, they said.

“The TPP was a matter of worry for us as Vietnam was a member of this trade bloc. So, it is good news for us that the deal has been scrapped,” said Mustafizur Rahman, executive director of the Centre for Policy Dialogue (CPD), a private think tank.

The CPD chief, however, said Bangladesh will have to remain “cautious” as there is a possibility that the US would sign bilateral deals with other countries for importing goods at a cheaper rate.

The US might sign the bilateral trade deal with Vietnam as well, he said.

“With the scrapping of the TPP, we also came out from an unusual competition in garment trade in the US market. Vietnam will not enjoy duty benefits anymore,” said Siddiqur Rahman, president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

“Bangladesh and Vietnam produce similar kinds of garment items and compete in the same markets. So, the abandonment of the TPP is quite good for us,” he said.

The US is the single largest export destination for Bangladesh.

Bangladesh exports products worth nearly $6 billion to the US market a year. Of the total export, 95 percent include apparel items.

“I hope the new [US] government will also return the GSP [Generalised System of Preferences] facilities to Bangladesh and withdraw the duty on export of garment items to the US,” Siddiqur said.

 

Source: The Daily Star